I Got a 1099-C From an Old Marriott Timeshare Debt

Question:

Dear Steve,

I received 2 1099-c in March. The first was for a Marriott Timeshare. The second was for a Credit card debt incurred in a business my husband had at the time. My husband and I are still married but have been separated for almost 2 years. I live in CA Last payments on this debts occurred in 2014.

I keep reading about this test period of 36 months that must happen before a 1099-c can be sent. Is this true because the last payment on the timeshare was 2014 and the last payment on the Credit card was also in 2014. If the 36 month test period applies then I received the forms too soon. I am in the process of declaring bankruptcy but it wont occur till Dec of this year due to some timing on debt that is being included. That is why it is important for me to know about the test period. I live on social security and do own a Manufactured home but it is all I have.

Thanks for your help.

Sandra

Answer:

Dear Sandra,

I’m no tax expert but it sounds like you are already insolvent and if that is the case you would not have to pay any forgiven debt tax by using Form 982. Please read this article.

Steve Rhode Debt Coach and Author

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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